Bank of America Securities released a report, upgrading China Pacific Insurance (02601.HK) from "neutral" to "buy" as the company's stock price has fallen 25% from its high on October 7. The current valuation is at a price-to-book ratio of 0.7 times for 2025, compared to 0.8 times for Ping An (02318.HK) and PICC (01339.HK), while the dividend yield for China Pacific Insurance exceeds 5%. Therefore, it is believed that the valuation of China Pacific Insurance is no longer a concern.

The firm recently held a conference call with China Pacific Insurance, believing that under the change in product strategy, it will sell more participating products while still dominating savings products. It is expected that there is potential for an increase in the new business value profit margin next year, with the profit margin for protection-type products anticipated to be between 70% and 80%, while the profit margin for savings and participating products is expected to be between 10% and 20%.

Bank of America Securities mentioned that, like most of its peers, China Pacific Insurance has yet to decide on its dividend policy for 2024, mainly due to a sudden increase in net profit. On the other hand, due to fluctuations in the stock market, the profit performance for the fourth quarter of 2024 remains unclear, and it is expected that the company will not provide further details on its dividend policy before February next year. The company's goal is to maintain stable per-share dividend growth, which can also reflect earnings growth. Therefore, it is anticipated that the company will likely make a higher per-share dividend, although the firm expects a payout ratio of only 25% to 30%, which is at the lower end of market expectations, while the dividend return still exceeds 5%.